Issue Information ‐ TOC

• Date: 01 July 2016
• DOI: http://doi.org/10.1002/jcaf.22191
• Published date: 01 July 2016

VOLUME 27, NUMBER 5 • July/August 2016

The Journal of

Letter From the Editor

James B. Edwards

Features

GAAP Accounting for Tax Equity Investments in Partnerships and LLCs

George L. Strobel II

This article takes a very practical approach to the reporting of tax equity investments in

partnerships and limited liability companies (LLCs). While generally accepted accounting

principles (GAAP) appear to specify the equity method, this article recommends bifurcation

of the investment into two pieces, one being the present values of the tax attributes, which

should be booked together with the other tax assets, and the second component being the

present value of expected cash flows from the investment.

Does Hedge Accounting Under SFAS 133 Increase the Information Content of Earnings:

Evidence From the U.S. Oil and Gas Industry

Nancy L. Beneda

This article examines the information content of repor ted earnings for a sample of U.S. oil and

gas firms that use hedge accounting, under Statement of Financial Accounting Standards (SFAS)

133 and International Accounting Standard (IAS) 39. The study finds that for firms that use

hedge accounting, earnings are more informative about firm value and risk exposure than firms

that do not use hedge accounting. The study also finds that firms that use hedge accounting

and are effectively using derivatives have higher firm value than other firms in the study sample.

Climate Change Disclosures Are Getting Hotter

Steven Harrast and Lori Olsen

Since the publication of climate change disclosure guidance by the Securities and Exchange

Commission (SEC) in 2010, the number of 10-K disclosures has seen more than a twofold

increase. Climate change disclosures are disclosures of risk from severe weather events and

pollution, although a company may also report opportunities arising from climate change. In

general, companies reporting weather risks disclose the potential for property damage and/

or temporary loss of business. Companies with significant greenhouse gas and other nuisance

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